WTOL: No income tax would force communities to make decisions
UC economist says local governments might increase property taxes, others could embrace lower burden
If Ohio eliminates the state income tax as lawmakers have proposed, other taxes might be increased or services might be cut, a University of Cincinnati economist told WTOL in Toledo, Ohio.
David Brasington, PhD, James C. and Caroline Kautz Chair in Political Economy and professor of economics
Republican representatives and senators announced plans for legislation that if passed would phase out Ohio’s income tax by the end of the decade. They said the elimination of the tax would encourage businesses and individuals to move to the state.
“The state income tax provides about 38% of overall revenue, so it's a big chunk,” said David Brasington, PhD, the James C. and Caroline Kautz Chair in Political Economy and economics professor in UC’s Carl H. Lindner College of Business. “And it goes toward the things the state government spends money on, like Medicare, Medicaid and K through 12 education.”
In response to the elimination of income tax revenue, other taxes such as local property taxes could increase to make up the difference, Brasington said.
Other Ohio communities could decline to increase taxes and embrace the lower tax burden on their residents.
“Other communities might say good riddance, we would rather have the lower taxes,” Brasington said.
Featured image at top: Tax papers. Photo/Kelly Sikkema via Unsplash
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